North Korea makes "significant" nuclear reactor progress: IAEA

VIENNA (Reuters) - North Korea has made significant progress in the construction of a light water atomic reactor over the past year, a U.N. watchdog report said, a facility that may extend Pyongyang's capacity to produce material for nuclear weapons.

The International Atomic Energy Agency (IAEA), citing satellite images, also said "certain activities" had been observed at locations where the reclusive Asian state "reportedly" conducted nuclear tests in 2006 and 2009.

But "without access to the locations the agency is unable to provide a technical assessment of the purpose of these activities or of whether nuclear material is being used," the annual report, issued to IAEA member states on Thursday, said.

North Korea's nuclear program is a "matter of serious concern", it said, adding that the country's statements about uranium enrichment activities and the construction of the reactor "continue to be deeply troubling".

North Korea says it needs nuclear power to provide electricity, but has also boasted of its nuclear deterrence capability and has traded nuclear technology with Syria, Libya and probably Myanmar and Pakistan. It is believed to be pushing ahead with plans for a third nuclear test. {ID:nL4E8JO284]

It became the first country to withdraw from the nuclear Non-Proliferation Treaty in 2003 and has denied IAEA access to its atomic sites, reneging on a February deal to do so after it announced plans to launch a long-range rocket, in defiance of United Nations Security Council resolutions.

In May, website 38North said North Korea had resumed construction work on an experimental light water reactor (ELWR) after stopping in December.

REACTOR WORK "PROGRESSING APACE"

38North - run by the U.S.-Korea Institute at Johns Hopkins University and former U.S. State Department official Joel Wit - said the ELWR, when operational, could produce enough material for an additional nuclear bomb each year.

U.S. expert David Albright estimated a higher potential production of about 20 kg of weapon-grade plutonium a year, enough material for four nuclear weapons or more. But he said it could also produce electricity.

"I think they do want to pursue this as an electricity route too, so it is really a question of dual use, and we don't know what they are going to do. North Korea would be able to do both," Albright told Reuters.

A highly enriched uranium program running alongside this could allow North Korea significantly to increase the number of nuclear devices it could produce, giving it a dual track to nuclear weapons as it has big reserves of uranium.

The IAEA said "significant progress" had been made in the reactor's construction since its previous report a year ago.

Progress included placing a dome on the reactor containment building and indications that some components may have been installed inside the building.

A system for pumping water from a river to the reactor for cooling purposes has also been built, the IAEA report said.

"However, without access to the site, the agency is unable to assess either the design features of the LWR or the likely date for its completion," the Vienna-based agency said.

Earlier in August Albright's think-tank, the Institute for Science and International Security, said satellite imagery from May and June showed construction "progressing apace". It said the reactor could be completed in the second half of 2013.